1 Process Statutory Comp
Risk
Sr No. Sub processes Risk Description Rating
Lack of knowledge as to
statutory compliance High
requirements
No defined process for
1.1 Statutory obtaining confirmation of Medium
compliance process stautory compliance from
various departments.
Non reporting of Statutory
non compliances Low
Statutory Checklist not being
1.2 compliance comprehensive and High
checklist updated on a regular basis
Non compliance of
commercial regulations High
Adherence to
1.3 Applicable Acts and
Regulations
Non compliance of
Adherence to Medium
Companies Act
1.3 Applicable Acts and
Regulations
Non compliance of
Statutory Payments i.e. HR/ Low
Employees/ Labour related
payments and deductions.
Process of
1.4 monitoring No corrective steps taken High
for non compliances
Compliance
Statutory Compliance
Document Required
Process Flow Chart and SOP's
Compliance checklist being
maintained and followed by the
company
Copies of monthly challans and
returns filled by the company as per
the various applicable Acts.
Form 20 B- sec 159.
Statutory register.
Minutes of BOD meetings and AGM
meeting.
Form 23AC and Form 23ACA.
Form 32- sec 264.
Form 24AA- sec 299 along with
disclosure as per sec 274 1(g).
Copies of monthly challans and
returns filled by the company as per
the various applicable Acts.
compliance checklist signed by the
compliance officer of the company.
Minutes of the BOD meetings
Statutory Compliance
Audit Procedures
Understand and document the statutory compliance process.
Check for the responsibility defined with respect to ensuring all applicable
statutory compliances and whether compliance requirements have been
comprehensively ascertained.
Ascertain whether the compliance officer issues a comprehensive checklist
to various departments, in order to obtain the compliance status.
Check if there is a standard format of compliance checklist forwarded to
the respective departments.
Ascertain that a confirmation as to the statutory compliance is obtained
from the respective departments on a monthly/ quarterly/ annual basis,
specifically stating the statutory/ legal compliances observed.
Check whether there is a procedure for reporting of non compliances to
statutory requirements, if any.
Ensure that non compliances are analysed and corrective action is taken
on timely basis.
i) Obtain the Statutory compliance checklist followed by the company.
ii) Check for comprehensiveness of the statutory checklist provided.
iii) Ensure that the statutory compliance checklist is approved by the Board
of Directors.
Check whether the checklist is comprehensive. i.e. all the Acts, Rules,
Regulations, Notifications of various government departments, etc
applicable to the company are included in the compliance checklist.
Check for the review process of the checklist.i.e. how often the
Compliance checklist is reviewed for necessary, modifications, inclusions
and deletions as per the changes in Government regulations and
notifications
Check for the approval of the compliance checklist followed.
i) Service Tax Act
ii) The Sales Tax/ VAT, CST Act/ Works Contract Tax.
iii) The Income Tax Act, 1961
iv) The Central Excise Act, 1944
v) The Central Excise Rules, 2002
vi) The Cenvat Credit Rules, 2002
vii) Rajasthan Shop and Establishment Act 1958
viii) Warehouse Act 2007
Sec 159
Sec 163
Sec 193
The Balance Sheet & P/ L account shall be filed with the registrar
Sec 264
Sec 299
Sec 301, 303, 307
i) The Employees State Insurance Act, 1948
ii) The Maternity Benefit Act, 1961
iii) The Contract Labour (Regulation and Abolition) Act, 1970
iv) The Payment of Wages Act, 1936
v) The Minimum Wages Act, 1948
vi) The Employees' Provident Funds & Miscellaneous Provisions Act, 1952
vii) The Professions Tax Act
viii) Sexual harassment policy as mandated by the Supreme Court in its
judgment “Vishakha & others Vs. State of Rajasthan & others (AIR 1997 SC
3011)
Check if the compliance requirement fulfilled by the various departments,
has been periodically verifed by the compliance officer.
Refer the minutes of Board meeting and verify if the status regarding
statutory compliances has been placed before the Board of Directors.
Ascertain that all the non compliances and rectification measures taken,
have been brought to the notice of Board members.
